Quicksilver Company Has Set the Following Standards for One Unit

question 19

Essay

Quicksilver Company has set the following standards for one unit of product:
Direct material
Quantity: 6.2 pounds per unit
Price per pound: $11 per pound
Direct labor
Quantity: 6 hours per unit
Rate per hour: $23 per hour
Actual costs incurred in the production of 2,800 units were as follows:
Direct material: $194,350 ($11.50 per pound)
Direct labor: $393,750 ($22.50 per hour)
All materials purchased were consumed during the period.
Required:
Calculate the direct-material price and quantity variances, and the direct-labor rate and efficiency variances. Indicate whether each variance is favorable or unfavorable.

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Definitions:

Ultra Vires

Actions or activities conducted by a corporation or its officers that lie beyond the powers granted by its charter or the laws.

Ultra Vires Contract

A contract that exceeds the powers granted to a corporation by its charter or bylaws.

Fourteenth Amendment

An amendment to the US Constitution that grants citizenship and equal civil and legal rights to all persons, including previously enslaved individuals.

Equal Protection Clause

A provision in the Fourteenth Amendment of the U.S. Constitution requiring states to treat all individuals within its jurisdiction equally under the law.